Hong Kong: Stocks fall more than 3% on China worries

HONG Kong stocks sank more than 3 per cent on Monday (Jul 11), in line with a sell-off across Asian markets on fears authorities will impose fresh lockdowns in Shanghai to control a fresh Covid outbreak in China.

The Hang Seng Index lost 3.06 per cent, or 665.78 points, to 21,060.00 in the afternoon.

Shanghai recorded more than 120 virus cases at the weekend, having seen its first case of the highly contagious BA.5 Omicron strain, forcing officials to launch another mass testing drive.

With China fixated on its zero-Covid strategy of wiping out the disease, there is increasing concern that authorities will revert to another painful lockdown, with Shanghai residents having only emerged from a 2-month confinement in June.

There have also been new infections uncovered in other parts of the country, including Beijing.

Tech firms were also suffering hefty selling pressure after authorities fined giant Tencent and Alibaba over not propertly reporting past deals.

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And Macau casino operators were also sharply lower after officials in the city embarked on a week-long lockdown to curb its worst coronavirus outbreak.

Mainland markets also closed well down.

The Shanghai Composite Index sank 1.27 per cent, or 42.49 points, to 3,313.58, while the Shenzhen Composite Index on China’s second exchange lost 1.47 per cent, or 32.56 points, to 2,187.34. AFP